Custard's Bakery produces a pie that requires 2.6 pounds of fruit per pie. The allowance for waste and spoilage per pie is .2 pounds and .1 pounds, respectively. The purchase price of fruit is $2 per pound, but a 4% discount is usually taken. Freight costs are $.10 per pound, and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00 per hour, but a raise which will average $.30 will go into effect soon. Payroll taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard production time is 1 hour per pie, and the allowance for rest periods and setup is .2 hours and .1 hours, respectively.

The standard direct materials price per pound is:

A. 2.13 b. 2.17 c.2.09 d.2.00

Question 2

Custard's Bakery produces a pie that requires 2.6 pounds of fruit per pie. The allowance for waste and spoilage per pie is .2 pounds and .1 pounds, respectively. The purchase price of fruit is $2 per pound, but a 4% discount is usually taken. Freight costs are $.10 per pound, and receiving and handling costs are $.07 per pound. The hourly wage rate is $12.00 per hour, but a raise which will average $.30 will go into effect soon. Payroll taxes are $1.20 per hour, and fringe benefits average $2.40 per hour. Standard production time is 1 hour per pie, and the allowance for rest periods and setup is .2 hours and .1 hours, respectively.

The standard direct materials quantity per unit is:

A. 3.0 B. 2.9 C. 2.7 D. 2.6